Yves here. These green bath cases may seem like weak tea, but they have the advantage of being discovered and allowing, among other things, the dismissal of top management. The potential for personal embarrassment and reputational damage is not something that top brass is usually well-placed to handle. And enough legal actions on the bottom lines may have an impact on the stock price, another very important factor soi-disant company leaders.
False advertising claims pursued in the US could prove to be a promising angle, as a successful claimant could receive attorney’s fees. Those claims would also seem to fit well with misrepresentations under securities laws.
While it is disappointing to see the slow pace of climate change, cases such as these will expose the lack and skepticism of many well-respected corporate and investor initiatives.
By Felicity Bradstock, freelance writer specializing in Energy and Finance. Originally published at OilPrice
In the latest in a long line of oil and gas companies to be accused of greenwashing, Australia’s second largest private oil company has been sued by the Australasian Center for Corporate Responsibility (ACCR) for misleading consumers about its decarbonisation targets. ACCR is a shareholder activist group that has bought shares in several emitting companies to try to encourage them to pursue the goals of the Paris Climate Agreement. This is not the first time that an activist group has accused an oil and gas company of laundering and misleading the public, but the outcome of the case may influence future legal action in the industry.
Monday was the first day of Santos’ 13-day trial in Australia’s federal court. The case, which was presented in 2021, says that Santos does not have the right basis to say that it has a clear strategy to reduce gas emissions by 26%, to 30% by 2030, and to achieve net-zero emissions by 2040. The ACCR says this amounts to misleading or deceptive conduct and puts the company in breach of Australian business and consumer laws. The case is the first of its kind and could provide a blueprint for future cases against oil and gas executives in other countries.
ACCR’s lawyer, Noel Hutley, said, “We will file a plea that Santos did not have reasonable grounds to make these statements.” Hutley suggested that Santos’ climate strategy was “more than a series of ideas … strung together over a period of a few weeks”, rather than a comprehensive approach to decarbonisation. ACCR uses additional examples to support its argument that Santos was deliberately laundering its oil and gas operations, such as the company calling natural gas a “clean fuel”. Santos also refers to blue hydrogen, which is produced using fossil fuels, as “clean” and “zero emissions”.
Santos often states that its net-zero programs rely heavily on the use of carbon capture and storage (CCS) technology, to help decarbonise its operations. The company aims to increase its oil and gas production while reducing emissions by using CCS technology. However, the ACCR says that Santos made “a list of undisclosed qualifications and assumptions about CCS procedures”. Dan Goucher, ACCR’s Director of Climate and Environment, said, “We read annual reports and sustainability reports from many companies every day. And some of these claims are completely unjustified… The bottom line for us is that I think it has become very difficult for any investor to distinguish between companies that are making real claims and companies that are not.
Santos is worth about $22 billion and operates onshore and offshore in Australia, the US, Papua New Guinea, and Timor-Leste. The court’s decision is being watched closely by activist groups around the world who hope it will put more pressure on oil and gas companies to be more transparent about their environmental impact and climate efforts going forward. ACCR hopes that the court will prohibit Santos from engaging in deceptive behavior in the future, and force the company to issue a corrective notice regarding the environmental impact of its operations.
Earlier this year, Rob Bonta, California’s Attorney General, filed an amended complaint aimed at encouraging major oil and gas players to stop profiting from misleading consumers about their role in climate change. In June, Bonta filed a lawsuit against the American Petroleum Institute (API), along with BP, Chevron, ConocoPhillips, ExxonMobil and Shell, for their deceptive behavior. Bonta accused the companies of false advertising and possible greenwashing. The press release said the firms used words like “clean” and “green” to make consumers believe their products were more environmentally friendly than they actually were.
Meanwhile, Italian oil giant Eni was sued last year for alleged early knowledge about the climate crisis. It was the first climate case to be launched in Italy. Several environmental groups are seeking legal action, accusing Eni of “persuasion and greenwashing” to promote high levels of fossil fuel production despite being aware of the dangers of its products since the 1970s. These allegations are largely based on research carried out by Eni between 1969 and 1969. 1970 which determined that increased use of fossil fuels could cause a climate crisis within just a few decades.
The report of the Isvet research center said, “Carbon dioxide in the atmosphere, according to the latest report of the UN secretary, given the increase in the use of carbon dioxide in the atmosphere. [fossil fuels]it has increased during the last century by an average of ten percent worldwide; by the year 2000 this increase may reach 25 percent, with ‘catastrophic’ effects on the climate.”
A new wave of lawsuits, aimed at forcing oil and gas executives to be more transparent about their environmental impact and climate efforts, is taking place in several countries around the world. Environmental organizations and activists no longer stand for environmental cleanup and are asking federal and state courts to limit the use of misleading language, and to force oil and gas companies to produce effective decarbonisation strategies with clear policies and mid-term goals to achieve them. their climate goals.
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